This capital infusion will enable Isthara to foray into the retail food court segment and establish its presence across 500 food courts within three years
Isthara, a co-living brand and smart food court service provider, has raised fresh funding of $10 million (Rs 81 crore) led by Dubai-based Eagle Investments. The current funding round brings Isthara’s total fund-raise to about $21 million.
In September 2021, Isthara raised funding from existing investors JM Financial Private Equity, Dubai-based Eagle Proprietary Investments and a few family offices. Recently, it acquired a software product engineering firm, Letsmobility, to digitise operations and introduce tech solutions in the co-living and institutional cafeteria sectors.
Isthara, which currently operates in the co-living and institutional smart food court space, will deploy the new funds to foray into the business-to-consumer (B2C) retail food court space and expand its presence in the co-living sector. While it has witnessed immense growth in the business-to-business (B2B) institutional cafeteria segment, the company aims to replicate this business success in the B2C space by launching smart food courts across retail locations such as malls.
Regarding funding, Gilbert James, promoter and managing director of Isthara, stated, “We believe that the food court segment and the co-living sector will undergo a massive digital transformation in the coming years. We aim to be the pioneers of a tech-enabled LivTech segment that solves the most basic issues of urban millennials.”
Elias Kawar, managing director of Eagle Investments, commented on the investment, saying, “With a rise in safety and hygiene concerns since the pandemic, we are seeing a fundamental shift as customers across the spectrum. They are increasingly opting for tech-enabled and safety-focused co-living and food options. Isthara is poised to disrupt the co-living and retail food court segment, and we are excited to support the company’s next growth phase as it continues to make new strides in the Liv-Tech segment.”
By foraying into the B2C food retail segment, Isthara hopes to widen its customer base potential and not be limited by a captive audience, as with institutional cafeterias. It aims to scale the food court business by 10X to 500 food courts across 30 cities in the next three years, catering to a million people monthly.
Additionally, it will utilise the funding to double bed capacity in the co-living and student accommodation segments to around 50,000 beds by 2025. The company aims to achieve a 10X revenue growth in the next three years.
Founded by Gilbert James and Vijayan Krishna Kumar in 2017, Isthara currently operates over 24,000 beds across Hyderabad, Bengaluru, NCR, and Chennai. Through its co-living spaces, it provides fully-furnished shared-living accommodation for working professionals and students, with a host of amenities. During the pandemic, it developed a new co-living business model, which saw its bed count grow by over 400 per cent since the pandemic.
In 2020, venturing into the digitised smart food court business, Isthara has since signed 50 food courts across India. Through these smart food courts, it has evolved conventional institutional food courts across educational institutes and corporates by digitising their food courts. Since its launch, the company’s smart food courts have witnessed an average per-ticket consumption growth of over 100 per cent in each city, as compared to its pre-modified traditional cafeteria format.